IN THIS ISSUE
Delaware Court of Chancery Declines to Dismiss Investment Firm from Stockholder Derivative Suit; Delaware Chancery Court Dismisses Majority of Claims Alleging that California Biotech Firm Profited from Nonpublic Information About Vaccine Development Efforts; Fourth Circuit Declines to Revive Shareholder Class Action; California District Court Finds Electric Truck Company’s Statements About Potential Contracts Give Rise to Actionable Claims.
On November 29, 2021, the Delaware Court of Chancery in In re Mindbody, Inc., Stockholder Litigation denied a joint motion to dismiss by investment firm Vista Equity Partners Management, LLC, Torreys Parent, LLC, and Torreys Merger Sub, Inc. (collectively, “Vista”) concerning claims that Vista aided and abetted breaches of fiduciary duty in connection with a proxy statement for its 2018 purchase of Mindbody Inc.
The case arises out of Vista’s $1.9 billion acquisition of Mindbody in 2018, which stockholder plaintiffs contend was unfair and tilted in Vista’s favor by three Mindbody officers laboring under conflicts of interest. Specifically, plaintiffs allege that Vista aided and abetted two categories of disclosure violations: Mindbody’s failure to include sufficient detail regarding interactions between Vista and Mindbody’s then-Chief Executive Officer Rick Stollmeyer in the proxy statement, and Mindbody’s decision not to disclose its preliminary fourth quarter revenue results.
With respect to the first category of...
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